BIDZ.com Inc. Investor Class Action Lawsuit Case - 05/07/2009
March 11, 2013 - Settlement proposed.
May 7, 2009 - On Thursday, May 07, 2009, an investor in BIDZ.com, Inc. (NASDAQ: BIDZ) has filed a proposed securities class action lawsuit in the United States District Court for the Central District of California on behalf of purchasers of common stock of BIDZ.com (NASDAQ: BIDZ) during the period between August 13, 2007 and November 26, 2007 against BIDZ.com and its chief executive over alleged Federal Securities Laws violations.
According to the complaint the plaintiff alleges that BIDZ.com and its chief executive violated the Securities Exchange Act of 1934 by issuing between August 13, 2007 and November 26, 2007 a series of false and misleading statements intended to project the picture of a financially sound and well-operating company, when, in fact, BIDZ.com, Inc. was operating with material deficiencies and undisclosed substantial problems that went to the heart of its business model. BIDZ.com, Inc. is an online retailer of jewelry, featuring a live auction format. Then on November 26, 2007, a Citron Research article identified numerous "red flags" and revealed previously undisclosed material problems with BIDZ.com Inc. Two days later Citron issued a second article that provided additional details, revealing, so the lawsuit, among other things, that BIDZ.com Inc engaged improper business tactics in order to artificially raise the auction price of its products. On this news, BIDZ.com Inc ‘s stock price dropped from a closing price of $19.94 on Friday, November 23, 2007, to a low of $10.10 on November 28, a loss of nearly 50%, so the plaintiff.
BIDZ.com, Inc is located in Culver City, California and had $187.13million in total revenue in 2007 and $207.41 in total revenue in 2008, with an net income of $18.13million in 2007 and $14.40 in 2008. Shares of BIDZ.com Inc closed on Thursday at $4.21 per share, down from a 52weekhigh of $13.95 per share and $19.94 per share in November 2007.